Trading gas for gasoline

George Stark of Cabot Oil and Gas gave a keynote address to attendees of a seminar on alternative fuel solutions for automobiles Friday at Waynesburg University.
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WAYNESBURG – Leaders in the oil and gas industry, along with state and local government officials and other stakeholders, gathered at Waynesburg University Friday for a presentation on the future of transportation fuels.

Entitled “Fill it up, what’s in your tank?,” the multiphased event, sponsored by Tri-County Oil and Gas Expo, enlightened participants in the slowly growing trend of using compressed natural gas as an alternative fuel source.

Keynote speaker George Stark of Cabot Oil and Gas told guests the time is here and now with the Marcellus Shale development to jump on the bandwagon of natural gas as an alternative fuel for vehicles. He said the benefits of conversion are undisputable in job creation, cleaner air standards and lower fuel costs.

“Planning is the key. We are building pipelines to move this energy to market,” Stark said. “If there a natural gas line going to be near intersections and off-ramps of highways, it is much easier to put a filling station in there.”

Stark said planning where the pipeline will lie in relation to interstates is paramount to achieving the goal of making the switch down the road to CNG.

“Right now, the pipelines are matching up very nicely with the highways. We need to make efforts statewide to make sure the rest of the commonwealth gets covered,” he said.

Stark implored attendees to talk to legislators and make their voices heard that this change is wanted. He referenced Pennsylvania’s Act 13, Chapter 27, the Natural Gas Vehicle Grant Program that offers incentives to retrofit vehicles to run on CNG.

Robbie Matesic, executive director of Greene County Department of Economic Development, was sold quickly on the idea of alternative fuel vehicles. Matesic recently took advantage of a deal through Honda and Clean Energy, the largest owner of public CNG fueling stations, to purchase a CNG Honda Civic for her daughter. Matesic said the car came with a $3,000 fuel card. That helps to offset the higher price of the CNG-fueled Civic over its gasoline-powered twin of about $10,000. Matesic said the fuel savings – since CNG costs about half that of traditional gasoline currently – quickly help to make up the difference in vehicle cost. Beyond that, she said she can only see savings for her daughter. She noted the cost of insurance was the same for both models.

The Civic CNG is on sale at 199 Honda dealerships in 36 states. The $3,000 fuel card incentive ends Jan. 2, 2013, or sooner if supplies run out. The card never expires.

There is a downside with a lack of CNG fueling stations in all areas. When Matesic’s daughter goes on a trip to Florida, it won’t be in her new Honda, according to her mother.

Stark, Matesic and countless other stakeholders in the Marcellus and Utica gas plays hope that changes. There is a push for Detroit to begin churning out cars and trucks that run on CNG and for the governments across the states to join in creating the infrastructure to support them. Right now, the conversion of one passenger vehicle is in the ballpark of $10,000, so bringing them off of the assembly line already fueled by CNG is the ideal. If that is the case, it could potentially bring the cost of the CNG vehicles to one that is more in line with its gasoline counterparts.

“We need to create a groundswell of support. Thirteen states have signed a memorandum of understanding,” Stark said. “There needs to be an effort out there where people are more supporting and encouraging of them to pass this type of legislation.”

The plan laid out in the memorandum is for these states to start replacing thousands of vehicles in their fleets with ones that run on natural gas. The hope is that this will ultimately drive demand for more CNG filling stations and CNG automobiles. Along with that is a dream of an interstate pipeline system that will support this hope.

“It can’t happen overnight. It is going to take its time. But, don’t overlook what is already occurring,” Stark added optimistically.